LOS ANGELES (CN) - A federal judge ordered a San Juan Capistrano businessman to pay $5.3 million in fines and restitution for defrauding customers in off-exchange, leveraged trading of precious metals.
Bharat Adatia aka Brad Adatia was charged with fraudulent solicitation, the Community Futures Trading Commission said in a statement announcing the federal consent order. The CFTC also sued Lions Wealth Holdings, Lions Wealth Services, and 20/20 Precious Metals.
The CFTC charged them with "falsely representing that customers were purchasing actual physical metal and issuing false account statements, among other illegal conduct," the agency said in a statement.
U.S. District Judge Josephine Staton entered the consent order and permanent injunction on Jan. 16.
The defendants lost their shirts in trading, the CFTC said: more than $2.4 million.
Lions Wealth and Adatia jointly must pay restitution of $1.8 million; 20/20 Metals and Adatia must jointly pay restitution of $540,000; plus civil penalties of $3.1 million.
Here is a link to a CFTC warning about how to spot precious metals fraud.
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